How IC Industry Respond Homogeneous Competition

Homogenization is an inevitable path for almost all industries as technology matures. And there is no exception for IC. For manufacturers, homogenization means more acquisition and bankruptcy, if without innovation. Then, how to grapple with IC homogenization via grasping market trends, determining customer demand change?

Cadence, GlobalFoundries, ARM and Mentor Graphics, in turn, tells their experience from the following four aspects:

Focus on improvement of validation and embedded software
Driven by fierce competition, electronics markets, including intelligent terminal, medical electronics, Internet of Things, are increasingly posing higher requirements for design and process. As two major cost items, application-related validation and embedded software, as well as 3D, IC, data analog technology is drawing invest.

“In the aspects of IP, Gadence has three strategies: first, target at 28nm and below IP, and do not develop 40nm, 65nm, 90nm IP; second, form expertise in analog IP and offer customization; third, develop advantages in IP integration, such as beforehand conducting software and hardware verification of IP in verification platforms,” says Liu Guojun, Cadence vice president and General Manager in China.

Foundry 2.0 mode to strengthen seamless corporation
With process stepping up to 28nm node and below, customers require new-generation foundry business model.

As such, GlobalFoundries introduces Foundry 2.0 mode, whose core is “co-operative device fabrication”. It needs abandon the traditional so-called three-section cooperation; designers should achieve parallel development of chip design, manufacturing and packaging, and use platform early to make foundry process technology become extension of customer strategy.

IC ecosystem moves toward 64-bit
The trend is triggered by Apple’s iPhone 5S. It is reported that Samsung will also adopt 64-bit processors in the next-generation Galaxy; maybe following by Sony, HTC… “64-bit AP will increase application in cellphones,” says Allen Wu, ARM president in Greater China.

Last year, ARM released 64-bit Cortex-A50 processors series. Now, Cortex-A50 series has Cortex-A53 and Cortex-A57 core, meeting application segments of low-end 64-bit handsets, high-end mobile phones, servers, PC, respectively.

Finer division of labor
Despite the increasing homogenization, companies still can find road in in-depth niches, via striving to offer customers NO.1 products, notes Peng Qihuang, Mentor Graphics global vice President and general manager of Asia Pacific

Mentor Graphics sees success in EDA tools-especially hardware emulator with high growth rate reaching 24% last year. For chip function verification, Mentor Graphics provides complete solutions for multimedia, networking, wireless, storage and embedded systems applications segments. It is expected that this year to be another harvest year.

Homogenization is a risk, especially threatening small companies. In order to maintain position, manufacturers should list it into risk management, conduction innovation or seeking new promising markets.